Guides / Income tax transition
AY 2026-27 vs Tax Year 2026-27: Which One Applies?
The year label depends on when the income was earned.
The key split is 1 April 2026
The Income Tax Department says the Income Tax Act, 1961 was repealed from 1 April 2026, subject to transitional savings. Income earned from 1 April 2026 is referred to as Tax Year 2026-27 under the Income Tax Act, 2025.
AY 2026-27
AY 2026-27 relates to FY 2025-26 under the old Act. Earlier tax years and relevant pending proceedings continue under the old framework.
Tax Year 2026-27
Tax Year 2026-27 begins on 1 April 2026 and replaces the old previous-year terminology for income governed by the new Act. The new framework discontinues the assessment-year label for those tax years.
Quick examples
- FY 2025-26 income → AY 2026-27.
- Income from 1 April 2026 → Tax Year 2026-27.
- A return for FY 2025-26 can still use AY 2026-27 terminology after 1 April 2026.
Compare Tax Year 2026-27 regimes →